Mammals manifest circadian behaviour timed by an endogenous clock in the hypothalamic suprachiasmatic nucleus (SCN)(1). Considerable progress has been made in identifying the molecular basis of the circadian clock(2,3), but the mechanisms by which it is translated into cyclic firing activity, high during the day and low at night, are still poorly understood. GABA (gamma-aminobutyric acid), a common inhibitory neurotransmitter in the central nervous system, is particularly densely distributed within the SCN, where it is located in the majority of neuronal somata(4,5) and synaptic terminals(6,7). Using an in vitro brain-slice technique, we have now studied the effect of bath-applied GABA on adult SCN neurons at various times of the day. We find that GABA acts as an inhibitory neurotransmitter at night, decreasing the firing frequency; but during the day GABA acts as an excitatory neurotransmitter, increasing the firing frequency. We show that this dual effect, which is mediated by GABA(A) receptors, may be attributed to an oscillation in intracellular chloride concentration. A likely explanation is that the amplitude of the oscillation in firing rate, displayed by individual neurons, is amplified by the dual effect of GABA in the SCN’s GABAergic network.